RenaissanceRe Holdings Ltd. | ||
Contents | ||
Page | ||
Basis of Presentation | ||
Financial Highlights | ||
Summary Consolidated Financial Statements | ||
a. | Consolidated Statements of Operations | |
b. | Consolidated Balance Sheets | |
Underwriting and Reserves | ||
a. | Consolidated Segment Underwriting Results | |
b. | Consolidated and Segment Underwriting Results - Five Quarter Trend | 7 |
c. | Property Segment - Catastrophe and Other Property Underwriting Results | 10 |
d. | Gross Premiums Written | 12 |
e. | Net Premiums Written | 13 |
f. | Net Premiums Earned | 14 |
g. | Reserves for Claims and Claim Expenses | 15 |
h. | Paid to Incurred Analysis | 16 |
Managed Joint Ventures and Fee Income | ||
a. Fee Income | 17 | |
b. | Fee income - Five Quarter Trend | 18 |
c. | Noncontrolling Interests | 19 |
d. | DaVinciRe Holdings Ltd. and Subsidiary Consolidated Statements of Operations | 21 |
Investments | ||
a. | Total Investment Result | 22 |
b. | Investments Composition | 24 |
c. | Managed Investments - Credit Rating | 25 |
d. | Retained Investments - Credit Rating | 26 |
Other Items | ||
a. | Earnings per Share | 27 |
Comments on Non-GAAP Financial Measures | 28 |
RenaissanceRe Holdings Ltd.
Basis of Presentation
RenaissanceRe Holdings Ltd. (the "Company" or "RenaissanceRe") is a global provider of reinsurance and insurance that specializes in matching well-structured risks with efficient sources of capital. The Company provides property, casualty and specialty reinsurance and certain insurance solutions to customers, principally through intermediaries. Established in 1993, the Company has offices in Bermuda, Australia, Canada, Ireland, Singapore, Switzerland, the United Kingdom and the United States.
This financial supplement includes certain financial measures that are not calculated in accordance with generally accepted accounting principles in the U.S. ("GAAP") including "operating income (loss) available (attributable) to RenaissanceRe common shareholders," "operating income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted," "operating return on average common equity - annualized," "tangible book value per common share," "tangible book value per common share plus accumulated dividends," "retained total investment result," "retained investments, at fair value," "retained investments, unrealized gain (loss)" and "operating (income) loss attributable to redeemable noncontrolling interests." A reconciliation of such measures to the most comparable GAAP figures is presented in the attached supplemental financial data. See pages 28 through 35 for "Comments on Non-GAAP Financial Measures."
All information contained herein is unaudited. Unless otherwise noted, amounts are in thousands of United States Dollars, except for share and per share amounts and ratio information. Certain prior period comparatives have been reclassified to conform to the current presentation. This supplement is being provided for informational purposes only. It should be read in conjunction with documents filed by RenaissanceRe with the U.S. Securities and Exchange Commission, including its Annual Reports on Form 10- K and its Quarterly Reports on Form 10-Q. Please refer to the Company's website at www.renre.comfor further information about RenaissanceRe.
Cautionary Statement Regarding Forward-Looking Statements
Any forward-looking statements made in this Financial Supplement reflect RenaissanceRe's current views with respect to future events and financial performance and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The Company may also make forward-looking statements with respect to its business and industry, such as those relating to its strategy and management objectives, plans and expectations regarding its response and ability to adapt to changing economic conditions, market standing and product volumes, estimates of net negative impact and insured losses from loss events and the acquisition of certain direct and indirect subsidiaries of American International Group, Inc., including Validus Holdings, Ltd., Validus Specialty, LLC, and Validus Reinsurance, Ltd. (the acquisitions, together with the other transactions contemplated by the Stock Purchase Agreement, the "Validus Acquisition") and its impact on the Company's business, among other things. These statements are subject to numerous factors that could cause actual results to differ materially from those set forth in or implied by such forward-looking statements, including the following:the Company's exposure to natural and non-natural catastrophic events
i
and circumstances and the variance it may cause in the Company's financial results; the effect of climate change on the Company's business, including the trend towards increasingly frequent and severe climate events; the effectiveness of the Company's claims and claim expense reserving process; the effect of emerging claims and coverage issues; the performance of the Company's investment portfolio and financial market volatility; the effects of inflation; difficulties in integrating the acquired business from the Validus Acquisition; risk that the due diligence process that the Company undertook in connection with the Validus Acquisition may not have revealed all facts that may be relevant in connection with the Validus Acquisition; that historical financial statements of Validus Reinsurance Ltd. are not representative of the future financial position, future results of operations or future cash flows of Validus Reinsurance Ltd. following the Validus Acquisition; the ability of the Company's ceding companies and delegated authority counterparties to accurately assess the risks they underwrite; the Company's ability to maintain its financial strength ratings; the highly competitive nature of the Company's industry and its reliance on a small number of brokers; collection on claimed retrocessional coverage, and new retrocessional reinsurance being available on acceptable terms or at all; the historically cyclical nature of the (re)insurance industries; the Company's ability to attract and retain key executives and employees; the Company's ability to successfully implement its business strategies and initiatives; the Company's exposure to credit loss from counterparties; the Company's need to make many estimates and judgments in the preparation of its financial statements; the Company's ability to effectively manage capital on behalf of investors in joint ventures or other entities it manages; changes to the accounting rules and regulatory systems applicable to the Company's business, including changes in Bermuda and U.S. laws and regulations; other political, regulatory or industry initiatives adversely impacting the Company; the Company's ability to comply with covenants in its debt agreements; the effect of adverse economic factors, including changes in prevailing interest rates and recession or the perception that recession may occur; the effect of cybersecurity risks, including technology breaches or failure; a contention by the U.S. Internal Revenue Service that any of the Company's Bermuda subsidiaries are subject to taxation in the U.S.; the effects of possible future tax reform legislation and regulations in the jurisdictions in which the Company operates; the Company's ability to determine any impairments taken on its investments; the Company's ability to raise capital on acceptable terms, including through debt instruments, the capital markets, and third party investments in the Company's joint ventures and managed funds; the Company's ability to comply with applicable sanctions and foreign corrupt practices laws; the Company's dependence on the ability of its operating subsidiaries to declare and pay dividends; and other factors affecting future results disclosed in RenaissanceRe's filings with the SEC, including its Annual Reports on Form 10-K and Quarterly Reports on Form 10- Q.
ii
RenaissanceRe Holdings Ltd.
Financial Highlights
Three months ended | Nine months ended | ||||||||||
September 30, | September 30, | September 30, | September 30, | ||||||||
2023 | 2022 | 2023 | 2022 | ||||||||
Net income (loss) available (attributable) to RenaissanceRe common shareholders | $ | 193,988 | $ | (825,344) | $ | 949,075 | $ | (1,544,670) | |||
Operating income (loss) available (attributable) to RenaissanceRe common shareholders (1) | $ | 422,303 | $ | (396,674) | $ | 1,189,746 | $ | (6,597) | |||
Underwriting income | |||||||||||
Gross premiums written | $ | 1,618,443 | $ | 2,220,661 | $ | 7,060,325 | $ | 7,628,264 | |||
Net premiums written | 1,421,260 | 1,821,711 | 5,880,766 | 5,850,544 | |||||||
Underwriting income (loss) | 385,804 | (683,114) | 1,106,438 | (166,450) | |||||||
Net claims and claim expense ratio: | |||||||||||
Current accident year | 58.1 % | 113.2 % | 55.3 % | 76.6 % | |||||||
Prior accident years | (9.0)% | (1.8)% | (5.6)% | (1.9)% | |||||||
Calendar year | 49.1 % | 111.4 % | 49.7 % | 74.7 % | |||||||
Acquisition expense ratio | 24.2 % | 23.6 % | 24.5 % | 24.5 % | |||||||
Operating expense ratio | 4.7 % | 3.7 % | 4.6 % | 4.4 % | |||||||
Combined ratio | 78.0 % | 138.7 % | 78.8 % | 103.6 % | |||||||
Fee income | |||||||||||
Management fee income | $ | 44,486 | $ | 24,989 | $ | 128,830 | $ | 82,918 | |||
Performance fee income | 20,072 | 739 | 37,181 | 5,414 | |||||||
Total fee income | $ | 64,558 | $ | 25,728 | $ | 166,011 | $ | 88,332 | |||
Investment results - managed | |||||||||||
Net investment income | $ | 329,108 | $ | 157,793 | $ | 876,148 | $ | 348,695 | |||
Net realized and unrealized gains (losses) on investments | (228,087) | (641,500) | (171,417) | (1,968,624) | |||||||
Total investment result | $ | 101,021 | $ | (483,707) | $ | 704,731 | $ | (1,619,929) | |||
Total investment return - annualized | |||||||||||
2.0 % | (8.9)% | 4.2 % | (10.1)% | ||||||||
Investment results - retained (1) | |||||||||||
Net investment income | $ | 216,764 | $ | 110,105 | $ | 574,088 | $ | 247,763 | |||
Net realized and unrealized gains (losses) on investments | (220,486) | (453,242) | (204,622) | (1,613,936) | |||||||
Total investment result | $ | (3,722) | $ | (343,137) | $ | 369,466 | $ | (1,366,173) | |||
Total investment return - annualized | |||||||||||
0.0 % | (9.6)% | 3.1 % | (12.7)% |
(1) See "Comments on Non-GAAP Financial Measures" for a reconciliation of non-GAAP financial measures.
1
Financial Highlights - Per Share Data & ROE
Three months ended | Nine months ended | ||||||||||
September 30, | September 30, | September 30, | September 30, | ||||||||
2023 | 2022 | 2023 | 2022 | ||||||||
Net income (loss) available (attributable) to RenaissanceRe common shareholders per common share - | $ | 3.81 | $ | (19.27) | $ | 20.17 | $ | (35.84) | |||
basic | |||||||||||
Net income (loss) available (attributable) to RenaissanceRe common shareholders per common share - | $ | 3.80 | $ | (19.27) | $ | 20.13 | $ | (35.84) | |||
diluted | |||||||||||
Operating income (loss) available (attributable) to RenaissanceRe common shareholders per common | $ | 8.33 | $ | (9.27) | $ | 25.32 | $ | (0.16) | |||
share - diluted (1) | |||||||||||
Average shares outstanding - basic | 50,261 | 42,837 | 46,345 | 43,121 | |||||||
Average shares outstanding - diluted | 50,358 | 42,837 | 46,451 | 43,121 | |||||||
Return on average common equity - annualized | 11.5 % | (72.4)% | 22.1 % | (40.5)% | |||||||
Operating return on average common equity - annualized (1) | 25.0 % | (34.8)% | 27.7 % | (0.2)% | |||||||
September 30, | December 31, | ||||||||||
2023 | 2022 | ||||||||||
Book value per common share | $ | 133.63 | $ | 104.65 | |||||||
Tangible book value per common share (1) | $ | 128.71 | $ | 98.81 | |||||||
Tangible book value per common share plus accumulated dividends (1) | $ | 154.85 | $ | 123.81 | |||||||
Year to date change in book value per common share plus change in accumulated dividends | 28.8 % | (19.7)% | |||||||||
Year to date change in tangible book value per common share plus change in accumulated dividends (1) | 31.4 % | (20.6)% |
(1) See "Comments on Non-GAAPFinancial Measures" for a reconciliation of non-GAAP financial measures.
2
Summary Consolidated Financial Statements
Consolidated Statements of Operations
Three months ended | Nine months ended | ||||||||||
September 30, | September 30, | September 30, | September 30, | ||||||||
Revenues | 2023 | 2022 | 2023 | 2022 | |||||||
Gross premiums written | $ | 1,618,443 | $2,220,661 | $ | 7,060,325 | $7,628,264 | |||||
Net premiums written | |||||||||||
$ | 1,421,260 | $1,821,711 | $ | 5,880,766 | $5,850,544 | ||||||
Decrease (increase) in unearned premiums | 334,616 | (54,690) | (659,078) | (1,140,715) | |||||||
Net premiums earned | 1,755,876 | 1,767,021 | 5,221,688 | 4,709,829 | |||||||
Net investment income | 329,108 | 157,793 | 876,148 | 348,695 | |||||||
Net foreign exchange gains (losses) | (25,886) | (1,383) | (53,877) | (67,690) | |||||||
Equity in earnings (losses) of other ventures | 10,842 | 1,739 | 28,072 | 2,732 | |||||||
Other income (loss) | (5,866) | 2,834 | (6,296) | 4,950 | |||||||
Net realized and unrealized gains (losses) on investments | (228,087) | (641,500) | (171,417) | (1,968,624) | |||||||
Total revenues | 1,835,987 | 1,286,504 | 5,894,318 | 3,029,892 | |||||||
Expenses | |||||||||||
Net claims and claim expenses incurred | 861,576 | 1,967,931 | 2,593,987 | 3,515,903 | |||||||
Acquisition expenses | 425,745 | 417,644 | 1,280,547 | 1,155,389 | |||||||
Operational expenses | 82,751 | 64,560 | 240,716 | 204,987 | |||||||
Corporate expenses | 17,143 | 10,384 | 53,357 | 35,238 | |||||||
Interest expense | 22,951 | 12,101 | 49,980 | 35,951 | |||||||
Total expenses | 1,410,166 | 2,472,620 | 4,218,587 | 4,947,468 | |||||||
Income (loss) before taxes | 425,821 | (1,186,116) | 1,675,731 | (1,917,576) | |||||||
Income tax benefit (expense) | (9,295) | (2,814) | (44,139) | 64,427 | |||||||
Net income (loss) | 416,526 | (1,188,930) | 1,631,592 | (1,853,149) | |||||||
Net (income) loss attributable to redeemable noncontrolling interests | (213,695) | 372,429 | (655,986) | 335,010 | |||||||
Net income (loss) attributable to RenaissanceRe | 202,831 | (816,501) | 975,606 | (1,518,139) | |||||||
Dividends on preference shares | (8,843) | (8,843) | (26,531) | (26,531) | |||||||
Net income (loss) available (attributable) to RenaissanceRe common shareholders | $ | 193,988 | $ | (825,344) | $ | 949,075 | $(1,544,670) | ||||
Net income (loss) available (attributable) to RenaissanceRe common shareholders per common share - basic | $ | 3.81 | $ | (19.27) | $ | 20.17 | $ | (35.84) | |||
Net income (loss) available (attributable) to RenaissanceRe common shareholders per common share - | $ | 3.80 | $ | (19.27) | $ | 20.13 | $ | (35.84) | |||
diluted | |||||||||||
Operating income (loss) available (attributable) to RenaissanceRe common shareholders per common share - | $ | 8.33 | $ | (9.27) | $ | 25.32 | $ | (0.16) | |||
diluted (1) | |||||||||||
Return on average common equity - annualized | 11.5 % | (72.4)% | 22.1 % | (40.5)% | |||||||
Operating return on average common equity - annualized (1) | 25.0 % | (34.8)% | 27.7 % | (0.2)% |
(1) See "Comments on Non-GAAPFinancial Measures" for a reconciliation of non-GAAP financial measures.
3
Summary Consolidated Financial Statements
Consolidated Balance Sheets
September 30, | December 31, | ||||
Assets | 2023 | 2022 | |||
Fixed maturity investments trading, at fair value - amortized cost $16,754,568 at September 30, 2023 (December 31, 2022 - $15,038,551) | $ | 16,083,046 | $ | 14,351,402 | |
Short term investments, at fair value - amortized cost $6,521,007 at September 30, 2023 (December 31, 2022 - $4,671,581) | 6,519,207 | 4,669,272 | |||
Equity investments, at fair value | 95,342 | 625,058 | |||
Other investments, at fair value | 3,167,941 | 2,494,954 | |||
Investments in other ventures, under equity method | 101,103 | 79,750 | |||
Total investments | 25,966,639 | 22,220,436 | |||
Cash and cash equivalents | 1,195,884 | 1,194,339 | |||
Premiums receivable | 5,928,809 | 5,139,471 | |||
Prepaid reinsurance premiums | 1,028,916 | 1,021,412 | |||
Reinsurance recoverable | 4,253,259 | 4,710,925 | |||
Accrued investment income | 153,573 | 121,501 | |||
Deferred acquisition costs | 1,267,088 | 1,171,738 | |||
Receivable for investments sold | 480,727 | 350,526 | |||
Other assets | 334,284 | 384,702 | |||
Goodwill and other intangibles | 233,897 | 237,828 | |||
Total assets | $ | 40,843,076 | $ | 36,552,878 | |
Liabilities, Noncontrolling Interests and Shareholders' Equity | |||||
Liabilities | |||||
Reserve for claims and claim expenses | $ | 15,955,165 | $ | 15,892,573 | |
Unearned premiums | 5,222,496 | 4,559,107 | |||
Debt | 1,882,893 | 1,170,442 | |||
Reinsurance balances payable | 3,323,606 | 3,928,281 | |||
Payable for investments purchased | 811,578 | 493,776 | |||
Other liabilities | 396,487 | 648,036 | |||
Total liabilities | 27,592,225 | 26,692,215 | |||
Redeemable noncontrolling interests | 5,662,234 | 4,535,389 | |||
Shareholders' Equity | |||||
Preference shares: $1.00 par value - 30,000 shares issued and outstanding at September 30, 2023 (December 31, 2022 - 30,000) | 750,000 | 750,000 | |||
Common shares: $1.00 par value - 51,173,930 shares issued and outstanding at September 30, 2023 (December 31, 2022 - 43,717,836) | 51,174 | 43,718 | |||
Additional paid-in capital | 1,836,742 | 475,647 | |||
Accumulated other comprehensive loss | (14,506) | (15,462) | |||
Retained earnings | 4,965,207 | 4,071,371 | |||
Total shareholders' equity attributable to RenaissanceRe | 7,588,617 | 5,325,274 | |||
Total liabilities, noncontrolling interests and shareholders' equity | $ | 40,843,076 | $ | 36,552,878 | |
Book value per common share | $ | 133.63 | $ | 104.65 | |
4
Underwriting and Reserves
Consolidated Segment Underwriting Results
Three months ended September 30, 2023 | Three months ended September 30, 2022 | ||||||||||||||||
Property | Casualty and | Total | Property | Casualty and | Total | ||||||||||||
Specialty | Specialty | ||||||||||||||||
Gross premiums written | $ | 511,012 | $ | 1,107,431 | $ | 1,618,443 | $ | 800,330 | $ | 1,420,331 | $ | 2,220,661 | |||||
Net premiums written | |||||||||||||||||
$ | 444,872 | $ | 976,388 | $ | 1,421,260 | $ | 696,520 | $ | 1,125,191 | $ | 1,821,711 | ||||||
Net premiums earned | |||||||||||||||||
$ | 760,365 | $ | 995,511 | $ | 1,755,876 | $ | 839,817 | $ | 927,204 | $ | 1,767,021 | ||||||
Net claims and claim expenses incurred | 206,361 | 655,215 | 861,576 | 1,372,583 | 595,348 | 1,967,931 | |||||||||||
Acquisition expenses | 143,348 | 282,397 | 425,745 | 141,675 | 275,969 | 417,644 | |||||||||||
Operational expenses | 54,624 | 28,127 | 82,751 | 48,158 | 16,402 | 64,560 | |||||||||||
Underwriting income (loss) | $ | 356,032 | $ | 29,772 | $ | 385,804 | $ | (722,599) | $ | 39,485 | $ | (683,114) | |||||
Net claims and claim expenses incurred: | |||||||||||||||||
Current accident year | $ | 350,238 | $ | 669,285 | $ | 1,019,523 | $ | 1,396,842 | $ | 602,995 | $ | 1,999,837 | |||||
Prior accident years | (143,877) | (14,070) | (157,947) | (24,259) | (7,647) | (31,906) | |||||||||||
Total | $ | 206,361 | $ | 655,215 | $ | 861,576 | $ | 1,372,583 | $ | 595,348 | $ | 1,967,931 | |||||
Net claims and claim expense ratio: | |||||||||||||||||
Current accident year | 46.1 % | 67.2 % | 58.1 % | 166.3 % | 65.0 % | 113.2 % | |||||||||||
Prior accident years | (19.0)% | (1.4)% | (9.0)% | (2.9)% | (0.8)% | (1.8)% | |||||||||||
Calendar year | 27.1 % | 65.8 % | 49.1 % | 163.4 % | 64.2 % | 111.4 % | |||||||||||
Acquisition expense ratio | 18.9 % | 28.4 % | 24.2 % | 16.9 % | 29.7 % | 23.6 % | |||||||||||
Operating expense ratio | 7.2 % | 2.8 % | 4.7 % | 5.7 % | 1.8 % | 3.7 % | |||||||||||
Combined ratio | 53.2 % | 97.0 % | 78.0 % | 186.0 % | 95.7 % | 138.7 % | |||||||||||
5
Underwriting and Reserves
Consolidated Segment Underwriting Results
Nine months ended September 30, 2023 | Nine months ended September 30, 2022 | ||||||||||||||||
Property | Casualty and | Total | Property | Casualty and | Total | ||||||||||||
Specialty | Specialty | ||||||||||||||||
Gross premiums written | $ | 3,217,817 | $ | 3,842,508 | $ | 7,060,325 | $ | 3,362,159 | $ | 4,266,105 | $ | 7,628,264 | |||||
Net premiums written | |||||||||||||||||
$ | 2,609,356 | $ | 3,271,410 | $ | 5,880,766 | $ | 2,474,661 | $ | 3,375,883 | $ | 5,850,544 | ||||||
Net premiums earned | |||||||||||||||||
$ | 2,206,471 | $ | 3,015,217 | $ | 5,221,688 | $ | 2,081,989 | $ | 2,627,840 | $ | 4,709,829 | ||||||
Net claims and claim expenses incurred | 675,963 | 1,918,024 | 2,593,987 | 1,804,268 | 1,711,635 | 3,515,903 | |||||||||||
Acquisition expenses | 429,273 | 851,274 | 1,280,547 | 406,338 | 749,051 | 1,155,389 | |||||||||||
Operational expenses | 165,514 | 75,202 | 240,716 | 144,717 | 60,270 | 204,987 | |||||||||||
Underwriting income (loss) | $ | 935,721 | $ | 170,717 | $ | 1,106,438 | $ | (273,334) | $ | 106,884 | $ | (166,450) | |||||
Net claims and claim expenses incurred: | |||||||||||||||||
Current accident year | $ | 933,172 | $ | 1,955,612 | $ | 2,888,784 | $ | 1,880,337 | $ | 1,728,262 | $ | 3,608,599 | |||||
Prior accident years | (257,209) | (37,588) | (294,797) | (76,069) | (16,627) | (92,696) | |||||||||||
Total | $ | 675,963 | $ | 1,918,024 | $ | 2,593,987 | $ | 1,804,268 | $ | 1,711,635 | $ | 3,515,903 | |||||
Net claims and claim expense ratio: | |||||||||||||||||
Current accident year | 42.3 % | 64.9 % | 55.3 % | 90.3 % | 65.8 % | 76.6 % | |||||||||||
Prior accident years | (11.7)% | (1.3)% | (5.6)% | (3.6)% | (0.7)% | (1.9)% | |||||||||||
Calendar year | 30.6 % | 63.6 % | 49.7 % | 86.7 % | 65.1 % | 74.7 % | |||||||||||
Acquisition expense ratio | 19.5 % | 28.2 % | 24.5 % | 19.4 % | 28.5 % | 24.5 % | |||||||||||
Operating expense ratio | 7.5 % | 2.5 % | 4.6 % | 7.0 % | 2.3 % | 4.4 % | |||||||||||
Combined ratio | 57.6 % | 94.3 % | 78.8 % | 113.1 % | 95.9 % | 103.6 % | |||||||||||
6
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RenaissanceRe Holdings Ltd. published this content on 01 November 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 01 November 2023 21:05:10 UTC.